In a large liquid measuring cup or medium batter bowl with a spout, whisk together milk, egg, water and vanilla.
Whisk in sugar, baking powder and salt until combined.
Gradually add the flour, and whisk until completely smooth. Set aside.
In a medium, deep-sided pan or pot, heat 1" of oil to 375 degrees F over medium-high heat. When you put the end of a wooden spoon in the pot and bubbles form around the spoon, it's ready. Reduce heat to medium.
Drizzle batter from cup in a thin line (you can also use a funnel to do this, holding your finger over the end to stop the flow of batter), swirling around the pan and overlapping as desired. Cook for 2 minutes or until light golden brown, then flip and cook another 2 minutes or until golden brown.
Dust with 2 tablespoons powdered sugar and serve. Repeat one more time with remaining batter.
Notes
*Nutrition facts do not account for the oil absorbed during the cooking process.